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Why China Shunned The Hummer

Why did the Chinese government step in to prevent a local company from buying the Hummer brand from GM? One theory is that Beijing just didn't want to be associated with the Hummer's markedly un-green image:

“Hummer is a fuel-gobbling vehicle,” said Liu Feng, a Beijing-based auto analyst with Southwest Securities. “The government rejected the deal to indicate a direction—China wants economical and environmentally friendly vehicles, rather than ones with large emissions and high fuel consumption.” ...

Chinese commerce ministry spokesperson Yao Jian hinted Thursday that concerns about the image the deal would present of Beijing’s environmental priorities had led to its demise. “China’s overall policy is certainly similar to the global trend—we’ll further encourage a sustainable economic development model and a green economy,” Yao said.

But here's another theory that has nothing to do with pollution:

But from the start, analysts had doubted that the privately owned Tengzhong—which until now had made machines for road and bridge construction and the energy industry—had enough expertise in global trade or auto production. “The government has shown it doesn’t approve of companies with no experience in car production or operations to start a business in the sector,” said Liu.

Either way, the Hummer's not dead just yet. Bloomberg reports that GM is still looking at several last-ditch buyers who could keep the behemoth alive. But that's a pretty thin hope: "GM may still wind down Hummer because most of those interested have done little or no due diligence on the unit, said the people [briefed on the discussions], who asked not to be identified because the talks aren’t public."

(Flickr photo credit: gmeurope)